As Donald Rumsfeld said, there are the known knowns, the known unknowns and the unknown unknowns. And these are also useful categories for employment law developments in 2019.
Brexit is the biggest ‘known unknown’
The UK is scheduled to leave the EU on 29 March 2019. The withdrawal agreement and political declaration about future relations were approved by the EU on 25 November but, at the last minute, the meaningful vote by MPs scheduled to take place on 11 December was called off by Theresa May. Currently, there seems little chance that the agreement will be approved by MPs. In those circumstances, the options appear to be to renegotiate the terms of the agreement, leave the EU with no deal, a general election or a second referendum.
The government has prepared a series of technical notices for a ‘no deal’ scenario and back in August, published Workplace Rights If There's No Brexit Deal. In this, the government states it “firmly believes in the importance of strong labour protections”. UK workers will continue to be entitled to the rights they have under UK law which derive from EU law – for example, paid annual leave and family leave entitlements.
That commitment appears clear enough, but the gloomy economic forecasts, problems with recruitment and loss of EU workers in key sectors such as health may result in some employers facing challenging issues in the months ahead.
- Sexual harassment – cleaning up the use of non-disclosure agreements and a statutory code of practice to specify the steps employers should take to prevent and respond to sexual harassment were just some of recommendations made to the government in 2018. Proposals to tackle this high-profile issue are expected in 2019.
- Data protection – the GDPR introduced significantly higher penalties for data protection breaches: €20m or four per cent of total worldwide annual turnover (whichever is greater). It will be interesting to see the Information Commissioner's approach in 2019, when the first fines for non-compliance may be issued.
- Modern Slavery Act 2015 – the effectiveness of the Act and areas for improvement formed part of an independent review and a report to the home secretary is expected by the end of March 2019.
- Gender pay reporting – with the 30 March and 4 April 2019 deadlines for reporting fast approaching, gender pay will continue to be a hot topic and the 2019 reports will be read with interest.
- Ethnicity pay reporting – a current consultation exercise on mandatory ethnicity pay reporting ends on 11 January 2019. If implemented, this is likely to be a much more complex exercise than gender pay reporting. There are many different ethnic groups, many employers don't have details of their staff's ethnicity and many staff are unwilling to disclose it.
There are some April dates that can be added to the 2019 diary with some definite ‘known knows’.
From 1 April, the hourly rate of the national living wage and national minimum wage increases for workers aged:
- 25 and over from £7.83 to £8.21
- 21-24 from £7.38 to £7.70
- 18- 20 from £5.90 to £6.15
- 16- 17 from £4.20 to £4.35
The apprenticeship rate increases from £3.70 to £3.90.
From 6 April, statutory sick pay (SSP) increases from £92.05 to £94.25 a week.
From 7 April, the statutory rates for family-friendly leave increases from £145.18 a week to £148.68.
From 6 April, employees (and, for the first time, workers) must receive an itemised pay statement setting out the hours worked where pay varies. Employers should check now that their payroll systems are able to comply with these changes.
The government's Flexible Working Task Force – co-chaired by the CIPD and made up of policy makers, employer groups, trade unions and professional bodies – will evaluate the effectiveness of the Flexible Working Regulations in April 2019.
Finally, for the ‘unknown unknowns’, we'll just have to wait and see what this year brings.
Paula Kathrens is a partner in the employment law team at Blake Morgan